THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

JOHN KING, CNN ANCHOR: Thanks, Wolf, and good evening, everyone.

Tonight major breaking political news, the presidential campaign of the former House Speaker Newt Gingrich implodes just five days before the first major Republican candidates' debate. Speaker Gingrich vows to fight on tonight, but he has virtually no staff and a fund-raising crisis.

And Congressman Anthony Weiner delivers an emphatic no to the growing choruses of Democrats who want him to resign, but up first tonight, important breaking news on the world stage.

We have new details tonight about what amounts to a secret war in Yemen. New promises from the United States and its allies to the anti-Gadhafi opposition in Libya, and disturbing new video suggesting the brutal Syrian regime has once again tortured a child as part of its effort to stifle political dissent.

These global challenges dominated today's Senate confirmation hearing for President Obama's choice to be the next U.S. defense secretary, Leon Panetta. Panetta now serves as the director of Central Intelligence.

And he told the Senate he would need to wait for a closed classified session before he could share most details of a newly intensified effort against al Qaeda in the Arabian Peninsula targets in Yemen.

CNN is told the secret campaign involves unmanned drones and fighter jets and it comes as the country teeters on the brink of a civil war.

(BEGIN VIDEO CLIP)

LEON PANETTA, DEFENSE SECRETARY NOMINEE: While obviously it's a scary and an uncertain situation with regards to counterterrorism, we're still very much continuing our operations.

(END VIDEO CLIP)

KING: Panetta also told Congress he believed Libyan leader Moammar Gadhafi's days are numbered. And as he did so, Secretary of State Clinton promised more U.S. help to the Libyan opposition. Attending a gathering in the United Arab Emirates, Secretary Clinton said Washington would contribute another $26 million in humanitarian aid to the Libyan opposition, and she made clear the NATO military strikes will continue unless and until Colonel Gadhafi yields power.

(BEGIN VIDEO CLIP)

HILLARY CLINTON, SECRETARY OF STATE: There is only one way forward for Libya. Attacks against civilians must stop. Gadhafi must go and the Libyan people deserve to determine their own future.

(END VIDEO CLIP)

KING: So let's discuss the dramatic changes and the challenges in the Middle East and North Africa with Senator Dianne Feinstein of California. She leads the Senate Select Committee on Intelligence.

Senator, thank you for your time tonight. I want to start with Yemen. As we learn about more U.S. air strikes, more U.S. drone attacks, there is essentially a secret war going on in Yemen. Are you comfortable with that?

SENATOR DIANE FEINSTEIN (D), SELECT INTELLIGENCE CHAIRMAN: Well, let me put it this way. Yemen is a very serious concern. Between March and June, the al Qaeda has taken over large swaths of land. We know that Awlaki is in Yemen. We know that out of Yemen is the planning of the possibility of attack against the United States.

So there is a direct national security interest right now in Yemen and the more confusion and the more disintegration the better it suits al Qaeda's purposes. So I am very concerned about what's happening in Yemen.

And I think it would be in our best interests to provide as much stabilization as we can and also to go after those al Qaeda targets like Awlaki who we know are in Yemen.

KING: There was a drone strike in early may targeting Mr. Awlaki. How close did the United States come?

FEINSTEIN: Well, I can't answer that. I don't believe -- well, I know he wasn't killed so that's all I can say.

KING: That's all you can say. What is your sense? Should the United States be accelerating these strikes now at a time of political uncertainty? We don't really quite know who's running the show in Yemen right now. Is this a time to step in and accelerate or is this a time to step back?

FEINSTEIN: I think this is a time to accelerate and try to take out the top al Qaeda targets. If we do that, we believe there will be a deterioration of al Qaeda. There really is no other thing that we can do right now, I believe.

You have to serve the interests of this nation, which is to protect our shores. Al Qaeda is the number one target. We have been able to take out Bin Laden. Now there's a number two, three, four, five and I believe the time is upon us to accomplish this mission.

KING: And what do you know? You have access to the intelligence. What do you know about what the United States believes will happen in Yemen? President Saleh is in Saudi Arabia being treated.

He has said through his people he expects to come back within days. We have from our sources reports that he has significant burning and it could be weeks if not months before he is capable of even trying to return. What do you know?

FEINSTEIN: Well, the thing I hear is that you are correct, that he is seriously injured. That it's going to take perhaps more than one surgery and that he is probably not going to be able to return for the next couple of months.

Now, that's the understanding and that's what I think also exacerbates the crisis, that we need to know that some semblance of order can be brought to Yemen and how we can be helpful in that regard.

KING: Is it your position that he should not return, period?

FEINSTEIN: I'm not going to make a statement there. But the statement I would make is there is every reason to have deep concern about Yemen. The al Qaeda groups, both Awlaki as well as other al Qaeda movers and shakers that are taking over territory, that are plotting and are planning and would carry out an attack against the united states, even perhaps around the anniversary of 9/11. So it is serious.

KING: Your friend, the CIA director and the soon-to-be defense secretary, Leon Panetta was on Capitol Hill today for his confirmation hearing.

As he moves over to the Defense Department, we are right now at day 83 since the NATO operations started in Libya. I want you to listen to Director Panetta, soon to be Secretary Panetta's assessment of the situation on the ground in Libya.

(BEGIN VIDEO CLIP)

PANETTA: We have seen the opposition make gains both in the east and the west. I think there are some signs that if we continue the pressure, if we stick with it, that ultimately Gadhafi will step down.

(END VIDEO CLIP)

KING: Senator, you hear Leon Panetta there say ultimately Gadhafi will step down. You have this remarkable situation in which NATO, with the United States blessing, is accelerating air strikes and everybody now publicly is saying they will keep bombing until Gadhafi leaves. When the United Nations resolution that authorized these military strikes says regime change is not the goal. FEINSTEIN: Well, I'm not going to get into that because Gadhafi is the beginning of all of this and he's also the end of it. There is no alternative other than Gadhafi leaving office. This is a bad man. He has not been good for his country and I think he ought to go.

And the president has very strongly said he ought to go. So I think efforts that are aimed at moving Mr. Gadhafi out of the country and out of his command and control areas, out of his palaces, are really very important to carry out now.

KING: And from a process standpoint, a constitutional standpoint, are you comfortable with how this has all played out. The president using his authority as commander in chief, saying he doesn't need the blessing of the Congress? Do you even as a matter of fact know how much is this costing the United States every day in Libya?

FEINSTEIN: Well, I don't have that figure.

KING: Should you have that figure?

FEINSTEIN: I'll get it. I'll get it. I think this, that there's a lot of discussion as to whether another authorization of use of force is necessary. Senator Kerry and McCain had a resolution, a sense of the Senate, which I am a co-sponsor of, which I would vote for if necessary.

I don't see, because we are playing such a subsidiary role now to NATO, that a real authorization of use of force is technically necessary. But this is an age-old dispute between White Houses and Congresses and probably will continue on. But if the Kerry-McCain legislation were to come up, I would certainly vote for it.

KING: Let me ask you lastly, as the leader of the Intelligence Committee, we hear these horrific reports coming out of Syria every day. We know there are refugees fleeing. We see these tapes that are put out by opponents of what we know to be a brutal regime, talking about children being tortured.

But we can't get in there independently with our own reporters. So sometimes we're not sure exactly what is happening inside Syria. How good is U.S. intelligence about what is happening on the ground inside Syria right now?

FEINSTEIN: I don't see much intelligence on what's happening on the ground in Syria, to be candid with you. I see more on television. And I too, as CNN has played, see people trying to escape to Syria -- from Syria to the border with Turkey.

The question is I think how broad and deep this is. I think the question also is can Mr. Assad assure his people that he can take the steps that are necessary to quell this?

I don't believe that this insurrection is going to go away. I think it's only going to grow stronger and so really it's up to Mr. Assad to do what is necessary to satisfy the people he represents.

KING: And then should an administration that said Mubarak must go, Gadhafi must go, Saleh should not return, say Assad must go?

FEINSTEIN: I think Assad must go. I think that's right.

KING: You believe -- should the Obama administration make that its policy, though? It's not right now.

FEINSTEIN: I understand it is not right now and I don't know whether the policy makes a big difference or not. You asked me for my opinion and I gave it to you.

KING: Senator Dianne Feinstein is the chair of the Senate Select Committee on Intelligence. Senator, thank you for your time tonight.

FEINSTEIN: Thank you very much.

KING: Still to come, Newt Gingrich vows to fight on tonight, but can his presidential candidacy survive the mass resignations by almost all of his campaign staff?

And next, new allegations Syria had a secret nuclear program and a new video suggesting the Assad regime is torturing children.

(COMMERCIAL BREAK)

KING: A new round of disturbing news about Syria today. The United Nations nuclear watchdog agency accused Syria of building a secret nuclear reactor capable it said of producing large amounts of plutonium for nuclear weapons.

Israel bombed that site in 2007. The findings now go to the United Nations Security Council, which is also working on a resolution calling for an end to the Syrian regime's brutal crackdown on peaceful protests.

Some of those demonstrations were sparked by the death of a teenage boy who apparently was tortured to death in government custody. Today there's a second such case. Now, we need to warn you.

This next report contains graphic images as well as video from the internet that we at CNN cannot independently verify. Here's CNN's Arwa Damon.

(BEGIN VIDEO CLIP)

ARWA DAMON, CNN CORRESPONDENT (voice-over): "My son. It's my son," a woman wails. "This scar here. I swear it's my son. I stitched the cut on him when he was little." His name was Tamir, and he was just 15 years old. His body is carried inside to be washed.

A voice curses the president. There is a visible gunshot wound below the teenager's knee. A voice says "look at the marks of torture" as the camera moves to show his discolored and seemingly bruised face.

KING: CNN's Hala Gorani among those helping us cover the Syria story. She's with us here in Washington tonight. When you see this, another case, what more do we know about this particular story and the allegation that the regime is not only brutalizing its own people, but including children in that?

HALA GORANI, CNN ANCHOR AND CORRESPONDENT: Well, according to one human rights group, 77 children have died since the beginning of the uprising as a result of violence, according to the Amnesty International report that was out recently, inflicted by government forces on peaceful protesters.

That's almost 10 percent of the total of deaths reported in the country. What we know about this young boy, 15 years old, Tamir Al Sahri, from the same village at Hamza Al Khatib. That's the 13-year- old who became such an icon for anti-regime demonstrators.

We don't know if the two knew each other, but according to activists in Syria and outside of Syria monitoring this story as well they went out on the same day, April 29th, in Daraa in southern Syria.

KING: Let's assume for this part of the conversation that this is the regime, that it's torturing children, killing children. From what you know about Assad and the way he operates, what is the message he's trying to send?

GORANI: Well, it's a message of terror to the civilians. And we are also hearing from activists that many of those who are tortured and detained are released a day or two before Friday prayers, and those are -- Friday has become the traditional day of protest in the Middle East in these Arab uprisings.

It's a message sent to the population that if you protest, if you send your children out to protest, this may happen to them. And Daraa, by the way, is the city where it all started because 15 children were arrested, you'll remember, for writing the anti-regime graffiti.

And that's when that city said no. You know, you can imprison me. You cannot imprison and torture my children.

KING: One of the challenges we have as a news organization is that we can't get in there. They won't let us in. The regime won't let us in, won't let our cameras in, won't let our reporters and producers in. A lot of this comes off the internet.

The challenge of verifying -- talk a bit about how we can do the best we can through these activists, through human rights operatives. So that when we do show these images we're not blindly throwing video on television.

GORANI: No, we're not. And sometimes mistakes are made, and sometimes everyone is duped. For instance, when the Syrian ambassador to France resigned on a French news network, it turned out that it wasn't her.

That France 24 was a network that called a number they always use to contact the Syrian embassy, and it seems as though they were, quote, "punked," if you will. However, when we use video of violence, when we show demonstrators who've been shot and killed and severely injured, we cross-reference that with testimony from eyewitnesses on the ground.

Several. It's old-fashioned journalism, John. This is the kind of thing you go through all the time. In this case it's got a virtual online tinge to it. And that's how we are able to get as much accurate information as possible.

And those, by the way, videos that turn out to be hoaxes are few and far between. Most of them are verified with information on the ground from inside Syria.

KING: So one of the big questions is can anyone in the international community get through to the Assad regime? The United Nations Security Council has now the reference from the Atomic Energy Agency.

It has the resolution Britain and the United States are pushing. Listen here to Secretary of State Clinton who was in the United Arab Emirates today saying the United States and its partners will keep up the pressure.

(BEGIN VIDEO CLIP)

CLINTON: We are working with our partners in the international community to bring an end to the violence and to support political and economic reforms. President Assad may try to delay the changes under way in Syria, but he cannot reverse them.

(END VIDEO CLIP)

KING: Cannot reverse them, Secretary Clinton says. But the administration, while getting increasingly critical, has not, as it did in Egypt, as it has done in Libya, as it has said about Yemen, it has not said Assad must go.

I talked earlier today to Dianne Feinstein, who's the chair of the Senate Intelligence Committee. She says he should go. Now, she didn't say that the administration should go that far. But she said in her opinion, yes, he must go.

GORANI: Well, you spoke of the United Nations and Britain and France sponsoring this U.N. resolution text that's been circulating. It does not even call for intervention. It's simply condemnation. And even that is not getting the support of all five permanent members of the U.N. Security Council.

So diplomatically, you can have statements made by the British foreign secretary, by the French foreign minister, but it doesn't seem as though right now it will go as far as any concrete action.

KING: It doesn't seem like Assad will pay any attention to it if it's just --

GORANI: Right now it doesn't seem so.

KING: Hala Gorani, appreciate your insights here tonight. Thank you.

When we come back, the day's big headlines, the latest news, and including spreading, raging wildfires in Arizona.

(COMMERCIAL BREAK)

KING: Welcome back. Here's the latest news you need to know right now.

President Obama called Arizona Governor Jan Brewer today to check on the wildfires that have forced thousands from their homes and are threatening now major interstate power and telephone lines.

Alabama's governor has signed a tough new immigration law. Much like Arizona's law, it requires police to check the status of anyone they suspect may be in the United States illegally.

Today, a federal jury acquitted a Chicago businessman of conspiracy to provide material support to the Mumbai terrorists. But the man was convicted of providing material support in a plot to bomb a Danish newspaper.

And this hour's breaking news. A U.S. military official confirms to CNN, the United States has resumed airstrikes in Yemen and drone attacks as well and believes it killed a top al Qaeda insurgent. "The New York Times" was first to report this news in a story by its National Security correspondent, Mark Mazetti.

Let's start first with the goal. You say the United States has dramatically intensified the strikes inside Yemen in recent days. Obviously, the targets are al Qaeda in the Arabian Peninsula. How are they doing?

MARK MAZZETTI, NEW YORK TIMES: Well, it's tough to know really how they're doing so far. There had been a few strikes since early may on these targets. We know that in early may they -- the U.S. almost hit Anwar al-Awlaki, one of the leaders of al Qaeda in the Arabian Peninsula.

But did not kill him, and there was a mid-level operative killed last week. These sorts of things are hard to judge based on so many -- so few operations. However, we would expect that they're going to continue, you know, in the several weeks and months ahead.

KING: We know that this is the group the president and his team worry about even more than al Qaeda based in Pakistan, even more than any other international terrorist group. This is the group the president would tell his top aides keep him up most late at night. What is their sense of the operational capabilities today of al Qaeda in the Arabian Peninsula? MAZZETTI: I think they're very worried. I mean, I think that they have been very I guess you say impressed by the level of capabilities of this group, the ability to very nearly strike the united states several times.

At the same time they worry that with the chaos in Yemen it's only an opportunity for al Qaeda in the Arabian Peninsula as long as the pressure's not kept on this group can continue to recruit, they can continue to plan operations.

So there is no lessening of concern in the White House about the group and what they're capable of.

KING: Mark Mazzetti of the "New York Times," thanks so much for your help.

MAZZETTI: Sure. Thank you.

KING: Still to come, Fareed Zakaria talks about what he calls a political paralysis to solve the country's job crisis.

And up next, Newt Gingrich says he's still in the race for president. Almost all of his staff quit today.

(COMMERCIAL BREAK)

KING: Tonight, Newt Gingrich is a candidate without a campaign. The former House speaker and now Republican presidential hopeful tells CNN he will fight on and still plans to take part in our big GOP debate. That's Monday night in New Hampshire.

But consider this. His campaign manager, his top strategist in Iowa, New Hampshire, and South Carolina, his press secretary, and a long list of other staffers resigned abruptly today as a group. Adding insult to injury, his national campaign co-chairman, the former Georgia Governor Sonny Perdue, also left the campaign today and already tonight is announcing his endorsement of another candidate, the former Minnesota Governor Tim Pawlenty.

All this unfolding as Gingrich is just back from a cruise in the Greek Isles. It was the last straw for a campaign team that says the former House speaker is having giant troubles raising money and rejected most of their advice about how to organize and run a campaign.

It's a Greek tragedy. One top Republican operative told me that with quite the snicker today. And this stunning setback for Gingrich comes with a conspiracy theory. Several of the Gingrich aides who quit are close to Texas Governor Rick Perry, who of late is sounding more and more interested about exploring a White House run.

Let's talk this over with veteran Republican strategist and long time Gingrich aide, Rich Galen is here tonight as is our chief political analyst, Gloria Borger and with us from the "New York Times" bureau, the national political correspondent of the "New York Times" Jeff Zeleny. Rich, to you first since you know Newt so well. He says he will fight on. He's going to make a campaign appearance this weekend in Los Angeles. He tells us he will be at our debate Monday night. Everybody left.

RICH GALEN, REPUBLICAN STRATEGIST: Well, I mean, you can -- you can sort of glide down to a close. I mean, somebody's got to do things like order a car and driver. I mean, there's a lot that goes into this. This is a speech to the Republican Jewish coalition that's been on the schedule for a while. It happens to be in Los Angeles.

KING: Does he last?

GALEN: No, I think it's over. I mean, at some point, he's just going to say, OK, this -- clearly there's no -- he said -- he said on his Facebook page he's going to restart the campaign in Los Angeles on Sunday. But that will be the third restart.

GLORIA BORGER, CNN CHIEF POLITICAL ANALYST: Yes.

GALEN: And if they've had trouble raising money already, then I don't know anybody who said, you know, I wasn't going to give any money but now that he's restarting again, boy, where's my checkbook?

KING: Jeff Zeleny, have you ever seen anything like this -- a coordinated mass resignation not just by the headquarters people but by all the big people out in the key states? This is a campaign without a structure now.

JEFF ZELENY, NEW YORK TIMES: It certainly is. And one of the problems here is, all of these aides had a long time to talk amongst themselves as Speaker Gingrich and his wife were on vacation for the last couple weeks. So that's when this really came to a head.

They tried to offer him advice. They urged him not to go on this. And he did anyway.

So, look, in some instances when a campaign restarts or gets new advisers, it's a good thing, like John McCain four years ago, almost the same time. It ended up being a good thing for him.

It's hard to think that it's the same scenario for Mr. Gingrich. He had to work extra hard to show that he was engaged, that he was able to get over these missteps he had. And it's hard to see how he continues beyond just having a platform, which perhaps is what he wanted most of all anyway.

BORGER: You know, John, it sounds like the campaign staff almost tried to do an intervention with their candidate, saying to him: OK, you want to be president, you have to get more disciplined, you have to start going to Iowa, you have to start raising money.

Discipline was always the question about Newt Gingrich. And, by the way, something I've heard from a couple of sources is: are you going to listen to us or are Mr. And Mrs. Gingrich going to run this campaign? Because there was also a lot of tension with his wife about who's running the candidate's schedule.

And so, I think they tried this intervention and in the end he wanted to do it his way.

KING: And, Rich, you're a veteran of campaigns. It is not uncommon for the staff and the spouse to sometimes have communication issues, strategy differences, how are you putting my spouse and partner out there. But in this case, is it more so?

GALEN: It appears to me -- and, you know, we've all known these folks for a long time. And it just -- it appears to me that if we get -- when somebody comes out from under the -- you know, the cone of silence that we will find out. It wouldn't surprise me that what it came down to is either we, the professional staff who's got hundreds of years of campaign experience, are going to run this thing, or you and Callista are going to run it, which way is it going to be? And I think obviously --

BORGER: And professional is the keyword. These are professionals. They wanted to run a campaign.

KING: David Carney in New Hampshire goes back for years running campaigns.

BORGER: Right.

KING: Katon Dawson, the former chairman of the South Carolina Republican Party.

BORGER: Exactly.

KING: Bruce Schoenfeld (ph) in Iowa --

(CROSSTALK)

KING: Veterans. And Sonny Perdue leaving at the top of this.

Let's talk about the polling. Speaker Gingrich had a challenge to begin with. He has high name recognition. Every Republican knows who he is.

But he was running at about 8 percent, if you look at the polling. We put the graphic up there for you. You know, Rudy Giuliani who's not even running, still thinking about it, but not even running, Governor Romney, Governor Palin who again is just thinking about it.

A lot of people -- a lot of people above Speaker Gingrich to begin with, Jeff Zeleny, and there was always the question: (a), would he have the discipline, (b), could he raise the money because he is unpredictable and sometimes combustible, and (c), would Republican voters looking for a new leader want to go back? Can he recover from a stumble like this?

ZELENY: It's hard to imagine how he could recover from a stumble like this. But I spent quite a bit of time with him out in road in Iowa. He did just finish a 17-city tour of Iowa. He was in smaller towns and far-flung places that most candidates haven't gone to.

So, it's not that he minded doing that. And people came out to see him. I was always struck by how big some of his crowds were. But once you talked to these voters, most of them said, look, I'm here to see Newt Gingrich, the former speaker of the House. They weren't there to see a presidential candidate who they were going to support.

So, that's probably what he -- he may have missed his window here in terms of introducing himself or reintroducing himself to these voters.

KING: All right. Let's deal with the conspiracy theory that comes with this. David Carney, who I mentioned, I've known him for years. He operates out of New Hampshire but he's the top adviser to the Texas Governor Rick Perry. Mr. Johnson, the campaign manager, ran Rick Perry's campaign for governor last time.

And the conspiracy theory is these guys got mad at Newt and they figured, you know, what he's not going to win, we're going to leave and formed a campaign in waiting. And what the governor says -- and I talked to David Carney today and others today, they say the governor has said that Texas legislature finishes its session in two weeks or so, he will look again at the question, but he's inclined not to run. Do you believe it?

BORGER: I don't know what to believe. Honestly, I really don't know what to believe. Again, you put one and one together sometimes, and you get two. And the question that awful us asked is OK, it's not as if you're going to be able to draw a direct line between these people leaving and, oh, OK, they're going to jump en masse to another campaign. So, it wouldn't be the cause of their leaving, but it could be -- the effect of their leaving could be that they end up working for Perry if he runs.

KING: But if you're Governor Perry, Rich Galen, and you're thinking about this and you're thinking, OK, I'm from Texas, I can raise money, but I am getting in, quote-unquote, "late," could I put a structure together? Well, here's your structure. It answers that question.

GALEN: Yes, exactly. And that's a very smart thing to do. That if he -- what you want to do is you want to have the infrastructure there so if you decide to flip the switch, you're not running around looking to see who's still available, you've got a bunch of guys that are on your PAC payroll and tomorrow, they're on the campaign trail.

BORGER: And I was told today by a Republican strategist that some big money people for Perry were making some phone calls to people in Washington saying, what do you think, should he do it, shouldn't he do it? So, they're taking a (INAUDIBLE).

KING: And, Jeff Zeleny, David Carney told me totally unrelated, totally unrelated, the fact the governor's thinking about this and this all happens today. David Carney, by the way, I'm sure, it was a coincidence, was in Texas when he had this conversation with me.

What do you think about Rick Perry?

ZELENY: I mean, he told me the same thing, it was unrelated. And I think it was unrelated in the sense he would not -- even Dave Carney, as bright of a strategist as he is, would not be able to orchestrate this mass exodus. The mass exodus was happening for a different reason.

But as Gloria said, it may not have been the cause. It could be the effect. So, now, I think that Governor Perry can make this decision surrounded by new information. Because Dave Carney and Rob Johnson, who was the campaign manager last year for Rick Perry and he was the campaign manager for Newt Gingrich, both of these guys have fresh information about what the electorate is looking for.

So, Governor Perry now, as he makes up his mind, has a lot more insight on what this race would look like than he had yesterday.

KING: Jeff Zeleny of "The New York Times," Rich Galen, Gloria Borger, thanks for your insights. Wow, it's certainly fascinating. We'll watch. And again, the speaker says he'll be with us Monday night. That's 8:00 in the East in New Hampshire and --

BORGER: Or Governor Perry.

KING: I don't know if he meets the criteria, but if he gets in the race, we'll have debates down the road. It will be a great debate Monday night. Mr. Speaker, we'll see you there, we hope.

When we come back much more politics. Mitt Romney gets a frosty reception in his birth state. That's Michigan.

And Congressman Anthony Weiner, more Democrats say he should quit. The congressman answered emphatically today. That's just ahead.

(COMMERCIAL BREAK)

KING: New developments tonight in a number of major political stories we're following. Once again today, the embattled New York Congressman Anthony Weiner said he's not resigning because of the scandal over his lewd photographs sent over the Internet. And, apparently, one of the people who want the congressman to stay on is his wife.

Our senior congressional correspondent, Dana Bash, is in touch with a number of Democratic sources.

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: He says no, he is not going anywhere, he is not resigning. And, John, that's despite the fact that public calls are continuing for him to resign. One of his colleagues today, Jim Matheson from Utah, conservative Democrat, publicly said he should resign. We understand that pressure is still mounting on him privately as well. And despite the fact some of his colleagues are continuing to give back campaign donations that he gave to them to make a public show of it, to say that "we're distancing ourselves from him."

And you mentioned the fact that he's talking about his wife. I'm told, John, that in a private conversation Weiner had with a fellow Democrat from New York, a New York congressman, that he said that he's not resigning and one of the reasons he gave was that he said his wife wants him to stay in Congress. And I'm told by a source familiar with that conversation that he was very dug in. He said he's not going anywhere.

You know, these conversations he's been having from afar because the House has not been in session this week. It is going to be very interesting to see if he does stay what happens next week when they come back, one of the members of the Democratic leadership in the House, Jim Clyburn, said today that the House Democratic Caucus is going to, quote, "have something to say about it" next week.

KING: Have something to say -- but you mentioned the House is out of session. The Senate is around. I want you to listen to a quote from number two in the Senate, Richard Durbin of Illinois, who can be pretty colorful sometimes but this is hard to top. He was asked about the scandal involving Congressman Weiner. He says, quote, "Don't murder someone who's already committing suicide. I think he has some serious problems that will not go away soon." Ouch!

BASH: Ouch is right. He said that to our Ted Barrett. I think he was alluding to a quote from Woodrow Wilson there.

But, you know, the thing that Anthony Weiner has going for him, he's going to probably talk about, is the fact that his constituents still support him. There's a brand new poll out tonight, John, that says 56 percent of the people in his very district say that he should not resign -- 56 percent. So, if he is somebody who is dug in looking for a reason and a way to stay, certainly, the point of that poll is going to be one of the ways he's going to do it.

BORGER: It's hard to say. Yesterday, I would have said no. Today, he sounds a little more dug in.

I think the key is going to be when members of Congress come back into town and he gets the pressure from them personally. They get to talk to each other. And then the ball could get rolling that way and say to him, you know what, you've got to go.

KING: See what happens. It will be very fascinating. Dana mentioned Jim Clyburn saying the House Democratic Caucus will have something to say about this.

BORGER: Yes.

KING: It will be very fascinating to find out how that meeting goes, how that meeting goes.

BORGER: It won't be positive.

KING: Stay with me, stay with me. I want to go to some other stories.

You know, Mitt Romney rolled into Detroit today. Remember, he was born in Michigan. His dad once ran the American Motors Corporation in Michigan.

Well, here's Romney trying to explain why he opposed the bailouts that as we now know had a big role in saving General Motors and Chrysler.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: There are some things I'd have done differently. I wouldn't have just written checks like the Bush and Obama administration did right off the bat. I wouldn't have written those checks. I would have said, go through bankruptcy directly on your own. And don't give the company to the UAW when you're finish. Those are things I would have done differently.

(END VIDEO CLIP)

KING: A little testy with reporters there from Governor Romney. It's interesting because it's number one, most Republicans. I mean, George W. Bush started it -- but most Republicans were flat out against it. They thought the government was intervening in the marketplace.

BORGER: Right.

KING: And so, Governor Romney is defending that ideological position.

BORGER: Which won't hurt him with Republicans.

KING: It may not hurt him in a primary. But Michigan, a lot of people think Michigan is back. It has been a reliably Democratic state in presidential politics for a while, but it just elected a new Republican governor. Republicans did well in the House races. And it's one of those Midwest battleground states that the Republicans think, hmm, in 2012 maybe.

BORGER: These bailouts are going to make a comeback in the presidential campaign. You know, during the 2010 midterm elections, you didn't hear anybody talk about the bailouts. The president has now been bragging about them, the car bailouts. But he didn't do it during the election because they were, you know, dirty words. He can't say bailout. But I guarantee you, as we head into this, this president's going to be going to Michigan, and he's going to be talking about how he saved the car companies from destruction. And if Mitt Romney is the nominee, that's going to be a real problem.

KING: It will be fascinating. A lot of people at home might be saying, well, OK, so what, he's not going to get the votes of the Democratic union members anyway. But Michigan is one of the places, if you go back in history, that's where the term Reagan Democrat came from. A Reagan Democrat where people, like union auto workers who maybe because of gun rights, maybe because of taxes, other issues, came over to Ronald Reagan.

This is an interesting hard spot for any Republican to be in because many of those Reagan Democrats, if they're union members who work in the auto industry, they're probably happy the government bailed out.

BORGER: Right. And there's also a sense that they paid their dues. That they got bailed out but they're paying you back.

So, we didn't get any -- you know, you helped us, but we're paying you back. And so, there's a sense there that it worked. And I guarantee you, it's an issue.

KING: All right. Here's another one now. One person who will not be at our debate Monday night but is still thinking about running for president is Sarah Palin, the former Alaska governor. When she went on that bus tour last week, she said it was a history lesson, right? She said, no -- people thought you're testing the waters for a campaign. She said, no, it's to highlight America's history.

She previewed the tour with a flashy new video. Here's what she's saying about it after the fact in another new video.

(BEGIN VIDEO CLIP)

SARAH PALIN (R), FORMER ALASKA GOVERNOR: This week of touring has been one of the best weeks of my life. It's been an honor to get to meet so many amazing, wonderful Americans who are deeply concerned about the country and do want to restore what's right about America.

(END VIDEO CLIP)

KING: So?

BORGER: Well, it sort of looks a little like a reality TV narration. And I think this is part of the rebranding of Sarah Palin, who many people thought was a relentlessly negative candidate. Now, she's so positive and such positive --

KING: But that rebranding of Sarah Palin, the political commentator on FOX News and the Republican, you know, important Republican person --

BORGER: Kingmaker. KING: -- or rebranding of Sarah Palin the candidate to be?

BORGER: Well, we don't know. I mean, we don't know. I mean, you know, earlier, we were talking about Newt Gingrich and organization and now he has no organization. Well, where is Sarah Palin's organization in early states? I mean, she seems to think that a campaign will spontaneously emerge from the grassroots for her. But so far, we haven't seen a lot of evidence of a campaign.

KING: But she clearly likes -- she clearly likes keeping the open question and keeping people like us talking about it. Even though she calls us the lamestream media, she spoke to a lot of us lamestreamers during this tour. She was very open and very accessible to reporters.

Here's -- listen to another little snippet here. Let's see if we can read the tea leaves.

(BEGIN VIDEO CLIP)

PALIN: We need a fundamental restoration of what's good about America. And that's going to take an aggressive fight -- hearing from these people encourages me to fight hard for that. Hopefully, I can inspire others in order to effect positive change.

(END VIDEO CLIP)

KING: Again, a candidacy -- it's going to take an aggressive fight. It encourages me to fight hard for that. Hopefully, I can inspire others in order to effect positive change.

So, again, you could read that one either way.

BORGER: You can read that one either way. You know what? She's still a contributor on FOX News. I have to believe that a conversation was had over there about whether you are or are not running. She's still on their air.

So, I think, at this point, we cannot consider her a presidential candidate. I think this was about rebranding Sarah Palin. She wants to have a huge influence on this race. She may want to pick the next candidate and endorse someone she believes will be good for the country. But I'm still not convinced that she's going to do it.

KING: -- you've got to make up your mind. That she's still on the payroll leads me to believe she has privately told them she's not running. But I was once adamantly in belief of that.

Now, when she says these things, when she looks at the field, when she looks at the race, you have to think there's a chance. BORGER: Yes, you do. But don't forget, Sarah Palin had sort of lost her newsworthiness to a certain degree. Donald Trump took up a lot of -- a lot of airtime. You had other candidates getting in the race, getting out of the race, taking up a lot of airtime.

And so, this was also her way of inserting herself back in the conversation in a more -- again, a more positive role. And I think that there were a lot of people saying to her, you know what, you can't just reflect people's resentments. You have to reflect their aspirations as well. And that's what this was about.

KING: We'll keep our on it and eventually -- eventually -- she'll give us a definitive word yes or no.

When we come back, you know the number one issue in the country: it is the economy and jobs. When we come back, our Fareed Zakaria, he has his own views of how Democrats and Republicans maybe, maybe just once can work together to help you.

(COMMERCIAL BREAK)

KING: The government reported today that 427,000 people applied for unemployment benefits for the first time last week. That's the ninth straight week that number has been above 400,000.

If you listen to the political debate here in Washington, Republicans say cut taxes and solve the deficit. The president says we need some key target investments.

Our Fareed Zakaria -- he thinks maybe the D's and R's can meet in the middle.

For more on the jobs crisis and the political debate about jobs, I'm joined by my colleague, Fareed Zakaria, the host of "FAREED ZAKARIA GPS."

And, Fareed, you write in your column what you call getting past the paralysis on jobs and you talk about the political climate right now. You say, "Republican concerns about government spending over the long term are understandable, but cutting spending in the short run will result in more unemployment and slower growth. President Obama talks about jobs but seems too paralyzed to do something ambitious to help create them."

If we have a paralyzed political discussion about the economy, what hope is there for the millions of Americans who are either unemployed or underemployed?

FAREED ZAKARIA, HOST, "FAREED ZAKARIA GPS": It's a terrible tragedy, because the reality is that the jobs crisis creates a new deficit crisis. If you don't get these people employed fully, the 24 million underemployed or unemployed, it's not just that their lives are ruined, their family's lives are ruined, their communities will face a difficulty -- it's that the deficit will get much worse.

So, if you care about the deficit, the single most important thing you can do is get people back to work because that's how you get them paying taxes, that's how they're no longer drawing unemployment insurance, they don't get other kinds of government assistance. And if you look at the history of the last 25 years, every time the deficit has gone down substantially, it has been because unemployment went down substantially. That's the key.

KING: And yet in this political climate, the president did have a stimulus plan. Republicans used that to their political gain. And some of those who have left the president's economic team say either it was too small then or we need more now. But you don't hear that from the president of the United States because of the politics of the moment -- stimulus is a dirty word.

ZAKARIA: Stimulus is a dirty word. And, look, I understand -- part of the problem is these things are terribly done, they're terribly designed. There's a lot of pork barrel spending.

That's why in the column, what I say is, let's try to come together on something that really makes a lot of sense and is a smart market-friendly way to handle this, which is a national infrastructure bank. You get the private sector to fund the building of roads, highways, airports, the way they do it in many, many countries around the world -- Germany, for example, India, all kinds of places.

We have a strangely socialist way of building infrastructure in this country. We should get the private sector involved and we can put the millions of Americans who lost their jobs in construction and housing, and those jobs aren't coming back. There isn't going to be a housing boom in this country for another decade.

And do we really want those people to lose their skills, their work habits, for another decade while we wait for them to sort things out and the economy to pick up again?

KING: Well, I had the president's top political adviser, David Axelrod, here yesterday and asked him between now and the campaign, given the opposition from House Republicans to just about everything the president proposes, if we would see any new big, major economic initiatives.

Listen to David Axelrod's response.

(BEGIN VIDEO CLIP)

DAVID AXELROD, SENIOR STRATEGIST, OBAMA RE-ELECTION CAMPAIGN: The president will provide his vision for the future. The things that he's driving toward to restore middle class economic security. Not just to recover from the recession, but also to recover what middle class people have lost over a long period of time in this country. And the Republican Party can offer their ideas.

So far, what we've heard is very much like what we saw during the last decade that led to a catastrophe. But they -- but, you know, that is what we will be discussing when the campaign is in full gear.

(END VIDEO CLIP) KING: He seems to be conceding that there will be nothing big, no signature, huge initiatives between now and the election. Can those underemployed and unemployed wait?

ZAKARIA: Look, there is a problem which is no matter what the president proposes, the Republicans say the only thing they want is to cut spending. Again, as I say, dealing with the deficit is important. It's a medium term/long term issue.

But in the short run, the more spending you cut, the more teachers you're firing, the more firemen you're firing, the more policemen you're firing, and the effect is, of course, that these people won't pay taxes, they won't go to the diner to buy anything, they won't buy clothes, and it furthers our economic crisis.

So, what the president needs to do, I think, is to take all his many good proposals together and make it clear that he has a jobs plan and that it is 90 percent private sector job creation, that the government is acting as a catalyst but it has a positive role for government. And then leave it to the Republicans to say they're all about the deficit. I think he should -- the president should make clear that he is also in favor of deficit reduction and has medium and long-term measures to deal with it.

But somebody needs to get out there and say that government has a positive, affirmative role to play as a catalyst, as a bridge, as a helper to try and get this economy moving again. Otherwise, as you say, you have all these people, 24 million Americans, whose lives are at stake and the fate of the economy, the deficit, the debt, all hinges on these people getting back to work.

KING: Do you see any evidence, though, that in this political climate, the president of the United States is willing to make that argument as you just laid it out?

ZAKARIA: I think that the president understands -- I mean, let me put it this way. I think that the president understands that these are the right ideas. You can tell that from the speeches he's been making. I think he hasn't found any traction.

You know, I mean, part of the problem is you move to the center, or, you know, you may lose some people on the left flank of your party, but you've got to gain somebody at the center to make the politics work out -- and he seems to be searching for those moderate Republicans who are fewer and fewer to find.

The infrastructure bank was supported by Kay Bailey Hutchison, by Chuck Hagel. You know, part of the problem is that Republicans now no longer support things they used to support. John McCain doesn't support the immigration bill that he was the co-sponsor of.

The climate has become so polarized and partisan and dysfunctional, frankly, that you wonder yourself, does anybody worry that the American people will say, "Aren't you guys meant to be doing our business? Aren't you meant to be solving problems? All we hear is no, no, no." KING: Excellent questions, as always, and insights. Fareed Zakaria, thanks.